Drilling contract sparks controversy in Waterford

After the recent passing of an oil lease agreement contract in Waterford Township, resident Jarret Schlaff walked out of the meeting a little more frightened than he was walking in.

"I'm afraid for the safety of our community's water, but this is a larger topic," said Schlaff. "(The trustees) did what they felt was best at the time, but they didn't truly listen ... their actions at the end of the meeting were not reflective of what type of discourse took place."

More than 100 residents attended a township board meeting Monday night as trustees voted in favor of an oil exploration contract with Jordan Development Company LLC in its lease of township-owned property.

Shouts of "Shame on you" rang throughout Waterford Township Hall as the contract passed with a 5-2 vote.

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Schlaff, one of the more vocal residents during the meeting, said Tuesday that he fears a contract with one oil company would open the floodgates for other entities to come to the area and drill if they get a permit from the Michigan Department of Environmental Quality.

"No company has to come to the township for permission," said Schlaff.

"Our contract was only with Jordan, who leased the biggest parcels in the township," said Wall.

He added that he doesn't think it would be logical for other companies to come to the township to pursue such small parcels of land. However, "you can't control private enterprise," said Wall.

Language in the contract stipulates that drilling on township-owned land will be prohibited by Jordan, as well.

Township Clerk Sue Camilleri said: "(Jordan) has already signed leases where the potential to drill is there, so we were just trying to protect the township from the (hydraulic fracturing)."

Hydraulic fracturing, commonly known as fracking, is a debated controversial method used by oil and natural gas drillers that injects pressurized fluids into the ground to extract the natural resources. Some argue that the potential negative effects of fracking on the environment outweigh the positive economic impact for communities with the acquisition of oil and natural gas.

A clause in the $74,000 lease agreement with Jordan to drill in 204 parcels of land stipulates that Jordan agree not to frack in the township.

The main concern during the meeting had been addressed in the contract with Jordan, Wall noted during the meeting. Put plainly, "No fracking means no fracking," he said.

Outcry from residents refuting Wall's claim was huge, with many voicing the opinion that there was nothing to stop other companies from drilling for oil in the township.

The general consensus among public commenters beforehand was clear: Vote against a contract allowing Jordan Development to search for oil on nearly 650 acres of Waterford Township-owned land. Concerned resident Cherie Billington said the board was "opening up Pandora's Box" by signing the contract. She said she worried about the aftermath of oil explorations.

So far, Jordan has already contracted for -- and has the potential to drill on -- 30,000 acres of land in Oakland County.

"We're averaging 15 to 20 leases a week with independent residents in your area," said Jordan Vice President Ben Brower.

Hal Fitch, director of the Office of Oil, Gas and Minerals of the Michigan Department of Environmental Quality, gave a presentation explaining the history of fracking in Michigan, the process and the regulations tied to the drilling of oil.

"It is not new in Michigan," Fitch said of oil drilling and fracking in general. "Eighty percent of the wells in Michigan use fracking."

The main concern that lies with hydraulic fracturing, he said, are migration of fluids, water use, chemical additive disclosure, management of wastewater, surface spills and earthquakes. Fitch attempted to prove that many of those concerns are very closely regulated.

During public comment, outcry against the contract on the table was 35 to one, with one man leaving after calling the board -- and representatives from Jordan -- "a bunch of crooks."

Fitch, whose department regulates companies like Jordan Development, said Jordan is in good standing as far as compliance.

Water Resources Commissioner Jim Nash attended the meeting and spoke during public comment. He warned of human error. The word "water" is in the community's name, said.

"People are people; they're not perfect," said Nash. "There is still the possibility of accidents."

Nash suggested that if Jordan says they will not do fracking, he would include in the contract that they do not hire anyone else to do their fracking.

"What we do now affects our kids and our grandkids," Nash said. "I would not want this anywhere near such a well-populated area."

Pat Gibson, vice president of joint venture company West Bay Exploration fielding questions from residents, said if less populated areas were sitting on top of oil, Jordan Development would be there.

"If we had the choice, we'd drill in Nevada where there is hardly any population," said Gibson. "We don't get to choose where oil is located."

Among other things, health risks connected with oil drilling near communities, legal provisions within the Jordan oil contract and concerns of residents being swindled were touched on by the public.

Commissioner Bob Hoffman, longtime resident of Waterford Township, spoke as well, and brought up the dilemma dealing with one oil company versus many.

"You're better off having one company who has the rights with no fracking than having multiple companies come in and legally be able to frack," he said.

Lawyer Lawrence Elkus, who represents some residents in the township, agreed.

"You can do more with leasing in terms of protecting your property than not leasing," he said. "For you to be able to have a no fracking provision in the contract is greater than what you can do by not signing."

Elkus explained that Waterford Township cannot legally have an ordinance stating that fracking is illegal, as there may be backlash from the state in the courts.

FYI

To learn more about hydraulic fracturing, visit michigan.gov/frackingfacts. Call the Water Resource Commissioner's special assistant at 248-858-1404 for more information on oil and drilling. To download a map of existing drilling units in Oakland County, visit michigan.gov/deq/0,4561,7-135-3311_4111_4231-210711--,00.html.